The Ministry of infrastructure of Ukraine announced the official launch of concession projects in the ports of Olvia and Kherson

In the framework of the implementation of pilot concession projects at the seaports Olvia and Kherson, the Coordination meeting with a consortium of international consultants was held today at the Ministry of Infrastructure of Ukraine. The consortium of international consultants were elected by the EBRD to develop feasibility studies and prepare tender documents for both projects.

Volodymyr Omelyan, the Minister of Infrastructure of Ukraine headed the coordination meeting. Representatives of the Ukrainian Sea Port Authority, the project office SP3ILNO, Ukrzaliznytsia, SE SC "Olvia", SE "Kherson Sea Port ", Nadiya Kaznacheyeva, the advisor to the Minister, representatives of the EBRD and IFC international team and experts from the best international companies took part in the meeting.

"Today, on March 13, a new phase in the implementation of pilot public-private partnership projects (PPP) in Ukrainian seaport industry starts. The Ministry is glad to announce the official launch of the two pilot PPP projects - in SE "Stevedoring company "Olvia" and SE "Kherson sea port", which will open the concession path and, we hope, will benefit to the modernization of the industry. In the coming weeks, a team of experts and consultants will begin the development of feasibility studies for projects. This stage requires special attention. We are convinced that a structured and transparent process that regulates interaction between government and business is important for both sides", - the Minister of Infrastructure of Ukraine said.

Volodymyr Omelyan stressed, that the Ministry of Infrastructure of Ukraine initiated the development of the draft law "On Concessions", which was approved by the Government at the end of 2017 and should to be submitted to the Parliament in March 2018.

"Concession projects in the ports of Olvia and Kherson are very important not only for the ports and industry, but for the state too. If these projects will held successfully - this will be an unequivocal success for Ukraine and a signal for foreign investors. And if the projects will fail, then we can forgot about the concession in Ukraine for years", - the Minister stressed.

Forasmuch as the seaports are an important component of Ukraine's transport infrastructure and export potential, the development of port infrastructure by attracting private investments is one of the strategic tasks of the Ministry of Infrastructure and the Ukrainian Sea Ports Authority.

"Taking into account an international experience, the concession as a mechanism of public-private partnership is an effective method to attract private investments to the development of port infrastructure. But for Ukraine it is a quite new, and therefore requires detailed elaboration. The preliminary feasibility studies of projects was started at the end of 2016 and today, due to the joint work of the Ministry of Infrastructure of Ukraine, SP3ILNO office and USPA we proceed to the final preparatory stage of concession project implementation in Olvia and Kherson ", - the head of the USPA Raivis Veckagans noted.

The projects envisage attraction of private investments in the amount of up to USD 45 million for the modernization, re-equipment and increasing of the transshipment capacity of the SE "Kherson Sea Port "; attraction of about USD 250 million for the construction of a new terminal and berths in the SE "Olvia". It will increase the capacity of cargo handling, ensure the development of the related infrastructure (railway station, electricity grids, roads), and, as a result, will increase economic activity in the region.

With the support of the World Bank and the EBRD in May 2017, the development of preliminary feasibility studies of pilot concession projects was successfully completed, which showed the expedient of further detailed development of feasibility studies.

At the end of 2017, a Memorandum of cooperation between the Ministry of Infrastructure of Ukraine and IFC was signed, as well as an agreement between the State Enterprise "USPA" and the EBRD on further preparation of feasibility studies.

In February 2018, the EBRD elected a consortium of international consultants to develop feasibility studies and prepare tender documents for both projects.